With the number of buy to let funding options increasing, the National Landlords Association (NLA) has warned that those with property to rent in London or other parts of the country should not get carried away.
Richard Price, director of operations at the organisation, commented: “Competition for quality rented accommodation is currently very high; it is likely that before the end of this decade one in five households will rent privately. As a result, there is great demand for landlords to provide the UK population with quality housing.”
He added that any buy to let products entering the market must be “sustainable, with consideration for the longer term”.
Mr Price’s remarks follow research from the NLA showing half (49 per cent) of landlords reported an increase in tenant demand during the first quarter of this year.
The same proportion said they expected this trend to continue during the rest of 2011.
Buy to Let Investment News
Homeowners should have right to kick out squatters says London Mayor Boris Johnson who has branded the current rules, which say squatters can only be evicted from a property through a court order, as “crazy” last week, reports the Ham and High.
He promised, along with fellow London Assembly member Steve O’Connell, to lobby the government to change the system to make it easier for homeowners to kick out squatters.
Mr O’Connell said: “The police need additional powers to quickly evict squatters from an illegally occupied property without a court order.
“It is completely unfair that someone’s home can be invaded and it’s weeks and weeks before the police are able to do anything about it because of the legal constraints.
“The balance needs to be shifted in favour of homeowners, not squatters. I’m pleased the Mayor has agreed to work with me to secure greater powers for the police.”
But Jack Tafari, who helps run the website ‘Advisory Service for Squatters’, has branded Mr Johnson’s plans as “ridiculous”.
Mr Tafari, a member of the group led by Latvian artist Jason Ruddick, who was recently evicted from a Highgate mansion, said: “Naturally squatters will get the worst end of the deal. With cuts you can anticipate lots more homeless people with fewer options. It’s the wrong time to tighten up the law. They’re talking about putting people in jail and giving them fines, which is ridiculous because people who squat don’t have money.
Landlords with property to rent in London might be interested to hear that research shows fewer tenants struggle to pay rent in the capital compared with other parts of the UK.
The Association of Residential Letting Agents (ARLA) found 40 per cent of its members reported a rise in the number of tenants nationwide who found it difficult in meet payments in the fourth quarter of 2010, compared with 35.9 per cent in the previous quarter.
However, off shore landlords with property in London are among those least affected, with just 27.9 per cent of ARLA members reporting rent payment problems.
Demand for affordable housing in London coupled with UK mortgage lending restrictions could be behind these figures.
Spencer Lawrence, lettings director at Paramount, commented: “We are experiencing an increased number of applicants renting as owner occupation continues to fall due to current stipulation of lending criteria coupled with concern over short term decline in the sales market.
“These factors are having a significant positive impact on rent achieved,” he added.
ARLA News
Those with landlord licences living in areas with low levels of demand could consider reducing their rental rate, LettingZone has suggested.
This is the advice from Mark Garner, founder of the organisation, who responded to research from the Association of Residential Letting Agents (ARLA).
ARLA’s study found there is an increasing number of tenants who are finding it difficult to meet rent agreements, although this was not seen so much for property to rent in London.
Mr Garner offered landlords some advice to ensure they are not struggling to pay the mortgage after a tenant defaults on the rent.
“Always do a full credit check before you take a tenant and I suggest you take out a rent guarantee insurance product before they move in which will cover you if your tenant stops paying their rent,” he said.
Meanwhile, research from Upad has found that 63 per cent of residential landlords are more confident this month than they were in December 2010.
Residential Landlords News
Increasing numbers of tenants appear to be struggling to make rental payments, according to letting agents.
According to latest research from the Association of Residential Letting Agents (ARLA) in the fourth quarter 2010, 40 per cent of ARLA members reported an increase in tenants struggling to meet rental payments in the preceding six months – a rise from 35.9 per cent in Q3 2010.
This is the first time the number has increased in 18 months, suggesting that job losses and pay cuts are beginning to take hold, causing tenants to have difficulties.The situation was least noticeable in central London, where just under a third (27.9%) of members reported an increase, compared with the rest of the UK (46.4%).
Ian Potter, Operations Manager at ARLA, said: “At the beginning of last year we predicted that the number of tenants having difficulties paying rent would increase and unfortunately, this seems to be the case today.
“It is a situation which can have serious repercussions throughout the PRS as, without guaranteed rent income, landlords may also have problems paying mortgages. At worst, it may result in a rise in repossessions.
“While it is difficult for landlords to predict whether current or prospective tenants will hit financial difficulties, our research highlights the importance for landlords or agents to implement a thorough selection process and to conduct reference checks on potential tenants – and to consider the benefits of rental protection insurance.
Increasing numbers of tenants appear to be struggling to make rental payments, according to letting agents.
According to latest research from the Association of Residential Letting Agents (ARLA) in the fourth quarter 2010, 40 per cent of ARLA members reported an increase in tenants struggling to meet rental payments in the preceding six months – a rise from 35.9 per cent in Q3 2010.
This is the first time the number has increased in 18 months, suggesting that job losses and pay cuts are beginning to take hold, causing tenants to have difficulties.
The situation was least noticeable in central London, where just under a third (27.9%) of members reported an increase, compared with the rest of the UK (46.4%).
Ian Potter, Operations Manager at ARLA, said: “At the beginning of last year we predicted that the number of tenants having difficulties paying rent would increase and unfortunately, this seems to be the case today.
“It is a situation which can have serious repercussions throughout the PRS as, without guaranteed rent income, landlords may also have problems paying mortgages. At worst, it may result in a rise in repossessions.
“While it is difficult for landlords to predict whether current or prospective tenants will hit financial difficulties, our research highlights the importance for landlords or agents to implement a thorough selection process and to conduct reference checks on potential tenants – and to consider the benefits of rental protection insurance.
Winter weather is one of many health and safety issues for landlords, who need to ensure their properties can withstand the severe conditions.
As snow and ice continues to affect many parts of the country, insurance provider Santander is highlighting the importance of preparing homes for the winter.
It pointed out that the estimated cost of storm and snow damage during the current cold snap is £1.1 million.
With further severe weather forecast in several areas, this figure could continue rising in the weeks ahead.
As well as physically preparing properties for wintry conditions, Santander also recommended that property owners secure landlord insurance to cover against any damage that does occur.
The group suggested keeping insurance documents in water-tight containers and having a photographic record of the contents of the property as evidence for claims.
Colin Greenhill, director of Santander Insurance, said: “The British weather is as unpredictable as it is uncontrollable but we can all ensure that should the worst happen we are correctly insured.”
Health & Safety News
Landlords with property to rent in London are among those whose annual void period has fallen by an average 15 per cent in the last year, according to research from LSL Property Services.
The average number of days a rental property has been left unoccupied is 30.9 days per year, down from October 2009′s annual average of 36.4 days.
Tom Entwistle, director of LandlordZone.co.uk, said the fall in void periods is due to increased demand from first time buyers who cannot secure UK mortgage lending deals and are forced to rent instead.
He posited that demand for renting will remain strong into 2011 and offered tips to landlords hoping to decrease their own void periods.
“Offer the right properties, in the right locations, to the right target tenant market, keep the properties clean and well maintained and up to standard regarding modern facilities.”
With regard to rental yields and returns in London, Mr Entwistle advised: “Ask a sensible rent in relation to the local market [and] look after good tenants when you get them.”
Landlords interested in rental yields and returns in London may be happy to hear that average rental prices are sure to increase in the short-term and could well continue rising over the next couple of years.
This is according to Mark Garner, director and founder of LettingZone, who pointed out that the demand for affordable housing in London will allow landlords to set rental costs as high as they like.
“Rents are definitely on the way up purely because of the lack of supply. There are no new properties coming on the market, so supply and demand [means] rent prices will go up. They won’t race away, but they will go up a few per cent definitely,” he asserted.
Changes to the housing allowance will also see more people wanting to go private than stay where they are, which means rents “are going to be pushed up for the next two years”, Mr Garner added.
His comments follow research from Zoopla which found buying a property is now more cost effective than renting in four-fifths of British towns and cities.
London Property to Rent
The issue of home security is one of many health and safety issues for landlords, but the British Insurance Brokers’ Association (Biba) has suggested that homeowners invest in industry-approved locks and alarms.
“The locks you get are important – make sure you’ve got the industry-approved ones because then you can get a discount on your insurance,” suggested Graeme Trudgill, technical and corporate affairs executive at Biba.
“Have them fitted by a proper fitter and, if the budget permits, go [for] an alarm system as that is an extra deterrent.”
Off shore landlords with property in London will want peace of mind with regard to their overseas buildings, so it is equally important to have adequate insurance on homes to ensure a loss of valuables will not put them out of pocket, Mr Trudgill added.
His comments follow research by Mintel, which found less than half (46 per cent) of homeowners have protected their properties against the risk of burglary with security measures such as extra window and door locks.
Health & Safety News.
